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Eliminate Your Debt Without Changing Your Lifestyle

When you are in debt, it can be very overwhelming. Often the pressures of debt can motivate you to make a plan to pay it off sooner than if you just made the minimum payments required by your lender. I know this from firsthand experience when my wife and I had $52,000 in debt when we got married in 2008. We were just starting off in life, and we had a negative net worth that was very discouraging.

There's a happy ending to our story though. We were able to pay off all $52,000 of debt in only 18 months! It was a liberating feeling, and it's something that motivated me to teach others to get out of debt in a short period of time.

Two Ways to Pay Off Your Debt Quickly

The first way is to increase your income. Traditionally, people will take on a second job, but that could cause a significant change in the way they are currently living. So the best way to earn some extra cash fast is to sell items around the house that you rarely use or just don't need any more. You may be surprised to find there are power tools in your garage that could be worth hundreds of dollars. Perhaps you are into designer clothes, and there are outfits you haven't worn in ages. Consider selling these items online or in a garage sale to earn some additional money to throw toward your debt.

The other way to demolish your debt is to reduce your expenses. You may be thinking, "Isn't this supposed to be about helping me get out of debt without affecting my lifestyle?" The answer is still "yes."

Before getting into what expenses you should cut, you need to make a list of all your expenses on a piece of paper. If you are into spreadsheets, then that might be an easier solution. You can adjust the sheet so it automatically totals all your expenses so you know exactly how much money you are spending each month. Once you determine which method of tracking you want to use, collect all of your statements for from the last month and begin writing down each expense.

There are some expenses that are not "fixed" and need to be addressed differently. Categories such as groceries, eating out or entertainment tend to include expenses that fluctuate from month to month, which makes them variable expenses. The best way to see what you spend in these areas is to take the last three months of your bank statements, and total up how much you spent in each category. Divide that number by three, and you will get your average spending for each category over the past 90 days.

Expenses to Consider Cutting

Now that you have a clear understanding of what your expenses are, go through your sheet line by line and ask yourself, "Is this category necessary?" If the answer is "no," eliminate it. If it is still something you want to spend money on, it is now your mission to see if you can get that item or service cheaper somewhere else. Here are a few categories in your budget that are easy to trim (or cut completely):

Cable. Nowadays, there are so many options to watch TV shows and movies, including Redbox, Netflix and Hulu. Many of these options are significantly cheaper then premium cable. There is even an option to get major cable channels such as ESPN, AMC and others through Sling TV, which only costs about $20 per month.

Groceries. With the average family spending around $4,000 a year for groceries, according to the Bureau of Labor Statistics, this can be one of the biggest budget busters. However, if you plan ahead and write a shopping list before going to the grocery store, it will help you avoid buying unnecessary items and stay within your budget.

Entertainment. Perhaps you love to go to the movies, and you don't want to give that up. You don't have to. Most movie theaters give a discounted rate if you go before 5 p.m., and some will offer even lower ticket prices if you see a movie before noon.

Cellphone. It's common to pay over $100 per month for a cellphone plan, but there are several companies making cellphone plans more affordable. For example, at Republic Wireless, you can get an unlimited talk and text plan with 2 GB of data for only $40 per month.

There are several ways you can eliminate your expenses. If you take the time to create a budget, you may be amazed by areas you can trim that won't affect your lifestyle.

Deacon Hayes is a financial expert and founder of Well Kept Wallet, a financial education company that provides personal finance curriculum for people across the world.